On March 28, 2023, the United Kingdom Gambling Commission (UKGC) announced that it fined three online gambling companies £19.2 million ($23.7 million) on social responsibility and anti-money laundering failures. £19.2 million is the largest amount ever paid to the UKGC as a result of breaches of social responsibility and anti-money laundering.
William Hill Group, also known as WHG (International) Limited, one of the largest brands in the global gambling space, owns and operates the three brands listed in the UKGC filing. WHG operates williamhill.com, Mr Green Limited, which operates mrgreen.com, and the William Hill Organization Limited, a brand that operates 1,344 physical gambling stores across the UK.
Details on William Hill and Mr Green
William Hill is one of the largest and most famous sports betting operators in the world. William Hill operates sports betting in the United States, the United Kingdom and on the Internet. William Hill Group (International) Limited owns and operates all three brands mentioned in the UKGC complaint.
The first penalized brand is williamhill.combrand of online sports betting, racebooks, poker room and casino games serving customers in the UK and other regulated markets.
The second brand mentioned, Mr. Green, operates an internet casino site that offers customers a variety of online gambling games including blackjack, roulette, slot machines, bingo and more. It also hosts sports betting. Mr. Green claims to be specifically focused on promoting responsible and safe gambling, but it’s a little unclear if that’s really the case based on recent failures.
The third brand named in the complaint is the William Hill Organization Limited, which operates 1,344 gambling halls. These William Hill locations primarily offer sports betting and horse betting to customers located throughout the UK.
Record £19.2m fine imposed by UKGC
As a result of the breaches by the three operators identified in UKGC’s complaint, UKGC will raise a total of £19.2 million ($23.7 million). WHG (International) Limited, which runs williamhill.com, has been ordered to forfeit £12.5 million ($12.5 million) and Mr Green Limited, which runs mrgreen.com, will forfeit £3.7 million ($4.56 million). Furthermore, William Hill Organization Limitedwhich operates 1,344 gambling establishments in the United Kingdom, will lose £3 million ($3.7 million).
These fines combine to be the biggest enforcement measures ever taken by the UKGC, beating the previous £17m ($21m) claim against Entain last year. From the beginning of 2022. operators have paid over £76m ($94m) to UKGC for regulatory gaps.
The failures detailed by the UKGC include numerous failures in social responsibility and anti-money laundering. Social responsibility failures include:
- The presence of inadequate measures to protect new customers and to effectively consider the quick costs and duration of the game to such an extent that the customer faces the risk of large losses in a short period of time:
- A customer opened a new account and spent £23,000 ($28,357) in 20 minutes without checks.
- Another customer was allowed to sign up for a new account and spend £18,000 ($22,193) within 24 hours without any checks.
- A third customer was allowed to sign up for a new account and spend £32,500 ($40,000) in less than two days without any investigation or checks. (Mr Green)
- Failure to identify specific customers at risk of gambling-related harm and failure to carry out checks early enough in the customer journey; one player lost £14,902 ($18,373) in just over an hour. (Mr Green)
- Failure to identify the risk of harm or intervene with certain clients early enough; a customer lost £54,252 (US$66,889) in four weeks without WHG seeking proof of income, carrying out adequate checks or using any other effective method(s) to identify the risk of impairment. (WHG Limited)
- Having insufficient controls, which exposes both returning and new customers to the risk of significant losses in a short period of time. One customer opened an account and lost £11,400 ($14,055) in the first month without going through enough checks. Another customer did not phone the firm until his losses reached £45,800 ($56,468). (WHG Limited)
- Failure to comply with a 24-hour period between receipt of a request for a credit limit increase and its approval. One customer was allowed to make a bet of £100,000 ($123,295) when his credit limit was previously set at £70,000 ($86,306). (WHG Limited)
- Ineffective controls allowed 331 users to gamble with WHG despite being self-excluded with Mr Green. (WHG Limited)
- Failure to identify changes in customer behavior that should lead to consideration of whether the customer has suffered harm – a safer gambling interaction with the bettor was only conducted after he had booked a bet of £18,000 ($22,193) (William Hill Organization Ltd)
- Having insufficient controls in place to protect new customers and to successfully consider high-speed spending and game duration, while the customer may be exposed to the risk of significant losses in a short period of time:
- After reopening a retail outlet after the Covid lockdown, the operator allowed one customer to lose £10,600 ($13,069) in two days without a safer gambling interaction.
- Staff did not identify a user as being at risk of gambling harm or pursue any interactions, although the customer is unknown and has placed £42,253 ($52,095) in 130 bets over a three-day period. (William Hill Organization Ltd.)
In addition to the extensive list of social responsibility issues listed above, the UKGC has also identified many anti-money laundering issues. The anti-money laundering failures identified in the complaint against William Hill are included below:
- Allowing customers to deposit large sums without proper checks – one customer managed to spend and lose £70,134 ($86,471) in a month, another lost £38,000 ($46,851) in five weeks and a third lost £36,000 ($44,386) in four days. (WHG Limited)
- Allowing customers to deposit large sums without carrying out proper checks – one deposited £73,535 ($90,664) and lost £14,068 ($17,345) in four months (Mr Green)
- Customers could bet large sums of money without being monitored or vetted to a sufficiently high standard – the operator did not ask for proof of source of funds (SoF) when one customer placed £19,000 ($23,425) in a single bet, received no documents from a customer who wagered £39,324 ($48,484) and lost £20,360 ($25,102) in 12 days and received no information or documentation about the source of funds from a user who wagered £276,942 ($341,454) and has lost £24,395 ($30,077) in two months. (William Hill Organization Ltd.)
- Policies, procedures and controls lacked guidance on the correct actions to take following the results of customer profiling and how the findings should be used to establish appropriate outcomes. (WHG Limited) and (Mr Green)
- The procedures and controls lacked hard stops to prevent further spending and reduce potential money laundering risks before the client’s risk profiling was complete. (WHG Limited) and (Mr Green)
- Anti-money laundering staff training does not contain sufficient information on risk management. (WHG Limited) and (Mr Green)
The UKGC also clarified that additional license conditions will be added to ensure that a business board member oversees an improvement plan and that the brand undergoes a third-party audit to assess whether it is effectively implementing its anti-bullying policies. money laundering and safer gambling, controls and procedures.
Andrew Rhodes comments on the penalty
Andrew Rhodes is the Chief Executive of the UK Gambling Commission. Mr. Rhodes had this to say about William Hill and this massive punishment:
When we started this investigation, the lapses we uncovered were so widespread that license suspensions were given alarmingly serious attention. However, because the operator immediately recognized their shortcomings and worked with us to quickly implement improvements, we instead opted for the largest forced payment in our history…
Over the past 15 months, we have taken unprecedented action against gambling operators, but we are now starting to see signs of improvement. There are signs that the industry is doing more to make gambling safer and reduce the possibility of criminal funds entering their business.
Operators use algorithms to detect gambling or criminal risk more quickly, interact with users more quickly, and generally have more effective policies and procedures.
As can be seen from the seriousness of Mr Rhodes’ comments, we can conclude that the breaches are some of the most serious in the history of the UK Gambling Commission. William Hill is a huge operator in the UK so the potential threat of losing their license could cost them their entire business or at least millions of pounds.
The UKGC has come down hard on operators recently
Back in August 2022, the UKGC imposed its largest fine to date when it fined Entain Group £17 million ($21 million). Another recent case came just a few weeks ago when the UKGC fined Unibet and 32Red £7.1 million ($8.7 million).
Another example of a serious fine came when the UKGC fined Caesars £13 million. While there are many questions about the success of the UKGC’s efforts, at least the larger fines may be more effective than some of the smaller fines imposed by other regulatory agencies, such as when the Gambling Control Division of the New Jersey fines operator $10,000 (£8,110).
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